The S&P 500 (^GSPC) is often seen as a benchmark for strong businesses, but that doesn’t mean every stock is worth owning. Some companies face significant challenges, whether it’s stagnating growth, heavy debt, or disruptive new competitors.
Some large-cap stocks are past their peak, and StockStory is here to help you separate the winners from the laggards. Keeping that in mind, here is one S&P 500 stock that is positioned to outperform and two that could be in trouble.
Two Stocks to Sell:
GoDaddy (GDDY)
Market Cap: $11.98 billion
Known for its memorable Super Bowl commercials that put it on the map, GoDaddy (NYSE: GDDY) is a domain registrar and web services provider that helps entrepreneurs establish an online presence through domain registration, website building, hosting, and e-commerce tools.
Why Do We Think GDDY Will Underperform?
- Customers had second thoughts about committing to its platform over the last year as its average billings growth of 3.6% underwhelmed
- Estimated sales growth of 5.9% for the next 12 months implies demand will slow from its two-year trend
- Operating margin expanded by 3 percentage points over the last year as it scaled and became more efficient
At $90.45 per share, GoDaddy trades at 2.3x forward price-to-sales. If you’re considering GDDY for your portfolio, see our FREE research report to learn more.
Deckers (DECK)
Market Cap: $14.81 billion
Established in 1973, Deckers (NYSE: DECK) is a footwear and apparel conglomerate with a portfolio of lifestyle and performance brands.
Why Should You Sell DECK?
- Constant currency growth was below our standards over the past two years, suggesting it might need to invest in product improvements to get back on track
- Responsiveness to unforeseen market trends is restricted due to its substandard operating margin profitability
- Capital intensity will likely ramp up in the next year as its free cash flow margin is expected to contract by 5.1 percentage points
Deckers is trading at $106.33 per share, or 13.7x forward P/E. Dive into our free research report to see why there are better opportunities than DECK.
One Stock to Buy:
Comfort Systems (FIX)
Market Cap: $64.25 billion
Formed through the merger of 12 companies, Comfort Systems (NYSE: FIX) provides mechanical and electrical contracting services.
Why Are We Bullish on FIX?
- Sales pipeline is in good shape as its backlog averaged 53.1% growth over the past two years
- Free cash flow margin jumped by 9.5 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
- Improving returns on capital reflect management’s ability to monetize investments
Comfort Systems’s stock price of $1,827 implies a valuation ratio of 41.8x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it's flagging for this month - FREE. Get Our Top 5 Growth Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
